This report has two main sections. In the first there is a review of the Australian Health Care system, the methods by which decisions are made with respect to the installation and financing of medical technologies and the regulatory mechanisms for their control. In the second part of the report results are presented from a survey of the diffusion of thirteen technologies in Australia. This is based upon a survey of all public and private hospitals in 1987. The purpose was to document the pattern of diffusion that has occurred in Australia and, more importantly, to determine the variables associated with the diffusion. For this purpose the report includes an extensive review of the empirical and theoretical literature on the diffusion of medical technology.